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KMCOFlyer
Posts: 233
Joined: Sat Aug 05, 2017 5:32 am

Re: United's Plans for Dulles

Fri Apr 20, 2018 4:53 am

nikeson13 wrote:
The future of IAD lies in a C/D rebuild from the ground up. If the terminal can become near a word-class terminal (in design) plus underground connections to landside and A/B (via walkway or train) it would give IAD the ability to become widely popular for both connections and O/D. UA/Others would be begging for a F/G to be built by 2030 if the C/D revamp plus better transit between terminals than the jetway shuttles happens.

But think about it: the whole East Coast is close to capacity: UA at EWR, DL at JFK+LGA, AA at JFK+LGA+DCA+PHL(still room to grow), B6 at JFK+BOS, WN at BWI. IAD is the only airport currently having a strategic advantage to grow and expand currently compared to other connecting AND O/D markets, and if I were management I would be pushing every bit of that to UA.


This is 100% accurate. MWAA needed to start building the new C/D concourse yesterday. The "temporary" C/D and the UA Express area in A is an embarrassment to IAD and UA. I don't understand how the busiest airline at an airport operates exclusively in the worst parts of the airport while everyone else gets to enjoy an actually 21st Century airport. If I were UA, I would push MWAA to start planning on construction for the new concourse ASAP.
 
SFOtoORD
Posts: 1216
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Re: United's Plans for Dulles

Fri Apr 20, 2018 5:13 am

KMCOFlyer wrote:
nikeson13 wrote:
The future of IAD lies in a C/D rebuild from the ground up. If the terminal can become near a word-class terminal (in design) plus underground connections to landside and A/B (via walkway or train) it would give IAD the ability to become widely popular for both connections and O/D. UA/Others would be begging for a F/G to be built by 2030 if the C/D revamp plus better transit between terminals than the jetway shuttles happens.

But think about it: the whole East Coast is close to capacity: UA at EWR, DL at JFK+LGA, AA at JFK+LGA+DCA+PHL(still room to grow), B6 at JFK+BOS, WN at BWI. IAD is the only airport currently having a strategic advantage to grow and expand currently compared to other connecting AND O/D markets, and if I were management I would be pushing every bit of that to UA.


This is 100% accurate. MWAA needed to start building the new C/D concourse yesterday. The "temporary" C/D and the UA Express area in A is an embarrassment to IAD and UA. I don't understand how the busiest airline at an airport operates exclusively in the worst parts of the airport while everyone else gets to enjoy an actually 21st Century airport. If I were UA, I would push MWAA to start planning on construction for the new concourse ASAP.


My guess is that when UA asked for a reduction in fees that also means they’re not interested in a fee increase in exchange for a new concourse.
 
KMCOFlyer
Posts: 233
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Re: United's Plans for Dulles

Fri Apr 20, 2018 5:23 am

nikeson13 wrote:
My guess is that when UA asked for a reduction in fees that also means they’re not interested in a fee increase in exchange for a new concourse.


If this is true, than UA must not be too serious on growing at IAD. If UA seriously wants to grow at IAD, it needs the new C/D concourse, plain and simple.
 
MapleLeaf789
Topic Author
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Re: United's Plans for Dulles

Fri Apr 20, 2018 12:46 pm

global2 wrote:
MapleLeaf789 wrote:
I noticed this piece in Flight Global this morning about United's plans for Dulles.

I have been travelling from Toronto to Sao Paulo over the past year. I fly direct on Air Canada but check connections too. United via IAD frequently comes up.

Just wondering if there could be an appetite for more South American connectivity through IAD? As well, liberalized agreements between Brazil and the U.S. could inspire increased flights?


But wouldn't connecting from an international origin to an international destination at a U.S. airport be a huge hassle? Wouldn't you have to clear customs, claim your bags, and
check in all over again, at least on the way back from Sao Paolo?


Indeed, and hence one of the major reasons why I don't do it. But for many people the savings would be worth it. AC does very well on the GRU flight and it's often pricey (after initial sales periods).
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evank516
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Re: United's Plans for Dulles

Fri Apr 20, 2018 2:04 pm

tphuang wrote:
Just curious because I have been thinking that IAD would be a great place for B6 to expand in the future since it seems from the outside to have room for growth. How much gate space is available in the main terminal?


B6 already tried to build up IAD, remember? Didn't work out.
 
tphuang
Posts: 5349
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Re: United's Plans for Dulles

Fri Apr 20, 2018 2:14 pm

evank516 wrote:
tphuang wrote:
Just curious because I have been thinking that IAD would be a great place for B6 to expand in the future since it seems from the outside to have room for growth. How much gate space is available in the main terminal?


B6 already tried to build up IAD, remember? Didn't work out.

It was back at a time when they were short on planes and DCA slots became available which made sense to move over. For any future expansion in the area, DCA slots won't be possible. So once they are out of space in BOS/FLL, IAD will be the most obvious place to expand.
 
IADCA
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Re: United's Plans for Dulles

Fri Apr 20, 2018 2:25 pm

tphuang wrote:
Just curious because I have been thinking that IAD would be a great place for B6 to expand in the future since it seems from the outside to have room for growth. How much gate space is available in the main terminal?


B6 used to have a much larger operation at IAD than it does now, but drew it down when it got a decent number of DCA slots. I think the larger issue for B6 vis a vis the DC area is that BOS/JFK/IAD would be a little heavy on the northeast, especially with bad weather. IAD isn't particularly gate-constrained at present, unless something has changed.
 
mmahpeel
Posts: 79
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Re: United's Plans for Dulles

Fri Apr 20, 2018 2:53 pm

Cost, cost and cost.

UA would love to move on to a new C/D and expand operations but the costs at IAD are very high, without the new C/D even being built.

As UA is trying to grow the domestic operation, with limited new aircraft it is more attractive to focus that growth at the other hubs first, given the challenges the high operating costs at IAD impose. That said I believe there will be modest additions at IAD for UA.

This has been mentioned numerous times in previous discussions, but the cost issue always seems to get lost and the discussion turns into a DCA vs IAD fight. IAD can stand on it's own very well, but the high costs (and perhaps the mis-management of MWAA) is clearly impeding significant growth.

Here are a few things from the interweb:

https://www.businesswire.com/news/home/ ... ligns-Cost

...airlines serving at IAD were subject to a considerably higher average cost profile in recent years ($25-$27 cost per enplanement) as compared to airline charges at DCA ($11-$14), and this differential poses greater challenges at IAD to attracting new flights....

https://www.washingtonpost.com/local/tr ... 3482cfc074

The cost of enplanement — or boarding a plane — per person last year was $9.51. At Dulles, it was more than twice that amount — $20.95. It was $13.44 at National.
 
77H
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Re: United's Plans for Dulles

Fri Apr 20, 2018 3:11 pm

blockski wrote:
flyguy84 wrote:
blockski wrote:

I don’t think anyone is suggesting that EWR be downsized. Rather, UA has choices of what kind of traffic they flow over each hub. And for more of their north-south domestic traffic on the east coast, they could choose to flow it over IAD instead of EWR.

The reasons to do so would be because of capacity and congestion, fitting with UA's goals to increase domestic connectivity as well.

It’s essentially adding a complimentary role to IAD's current internationala gateway hub. The commentary here notes that UA runs four banks at IAD, only one of which (the PM European bank) uses all of their gates. They could fill out those other banks as well with additional domestic traffic without taking anything away from EWR and instead making it the place for that net growth Scott Kirby outlined in UA's strategy last year.

If you run N/S connections over IAD instead of EWR it would most certainly lead to downsizing and cuts to flights. You can’t run indentical traffic flows over both airports, regardless of the type as they would cannibalize each other. The only way to reduce congestion and capacity issues at EWR would be to re-slot the airport. United isn’t going to make any service changes and allow someone else to add more flights in lieu of those cuts.


This is delving into pointless pedantry, but since UA wants to grow domestically, they can focus that domestic growth on the east coast at IAD, particularly for connecting traffic. The net effect would be that IAD grows at a faster relative rate than EWR for those passengers. The strategy does not require removing any traffic from EWR at all.


Except shuffling connecting flows from EWR to IAD inherently leads to downsizing as flyguy states. Every flight into a hub is going to have a mix of O&D and connection passengers. Even if you only take the connection passengers that are not connecting to hub-specific flights and route them over a different hub you’re taking revenue butts out of seats which can very well lead to aircraft downgauges and even frequency cuts.

I’ll give you an example. (Bare with me as I’m just making up numbers and flights for discussion’s sake.)

Let’s say you have 20 people a day flying BOS-LAX via EWR on the first flight out of BOS to EWR. Arguably these passengers could be routed over IAD without impacting travel time. The first flight out BOSEWR is operated by a 120 seat 319. Those 20 passengers connecting over EWR help to justify the use of the 319 on that flight. If you take those 20 people/day off that flight there’s no guarantee you’ll be able to backfill. With 20 people off that flight load factor drops and downgauging to the next smallest aircraft, the E75 may make more economic sense. Now, you only have 76 seats available to sell to passengers who are O&D BOSEWR or connecting to EWR-specific flights rather than 100 seats. This will inevitably lead to loss in market share as those 24 passengers have to look for alternatives.

77H
 
toxtethogrady
Posts: 1861
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Re: United's Plans for Dulles

Fri Apr 20, 2018 3:26 pm

william wrote:
This.............
"One big question facing Dulles is whether MWAA and United can reach an agreement on a new concourse C/D to replace the temporary facilities that the airline has used since the mid-1980s."


There are still some perfectly good planning documents sitting on the shelf at MWAA's Engineering Division waiting for UA to sign on the dotted line. And have been since 2008...
 
flyguy84
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Re: United's Plans for Dulles

Fri Apr 20, 2018 3:29 pm

toxtethogrady wrote:
mmahpeel wrote:
Cost, cost and cost. UA would love to move on to a new C/D and expand operations but the costs at IAD are very high, without the new C/D even being built.


Cost has been no deterrent to all the international carriers that have started service at IAD in the last few years. If United thinks IAD is expensive, wait till the O'Hare expansion is done.

The ORD expansion won’t drastically raise fees. The agreement is already signed, United knows what’s in it. They wouldn’t have agreed to something that would allow costs to skyrocket.
SFO
 
toxtethogrady
Posts: 1861
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Re: United's Plans for Dulles

Fri Apr 20, 2018 3:30 pm

mmahpeel wrote:
Cost, cost and cost. UA would love to move on to a new C/D and expand operations but the costs at IAD are very high, without the new C/D even being built.


Cost has been no deterrent to all the international carriers that have started service at IAD in the last few years. If United thinks IAD is expensive, wait till the O'Hare expansion is done.
 
mmahpeel
Posts: 79
Joined: Sat Oct 11, 2014 11:18 pm

Re: United's Plans for Dulles

Fri Apr 20, 2018 3:37 pm

toxtethogrady wrote:
mmahpeel wrote:
Cost, cost and cost. UA would love to move on to a new C/D and expand operations but the costs at IAD are very high, without the new C/D even being built.


Cost has been no deterrent to all the international carriers that have started service at IAD in the last few years.


UA has added service as well. However, in the current environment (cost being a factor) UA is going to get more bang for their buck by deploying growth (allocating assets/aircraft at a higher level than IAD) at some of the other hubs.
 
ldvaviation
Posts: 1258
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Re: United's Plans for Dulles

Fri Apr 20, 2018 4:23 pm

toxtethogrady wrote:
There are still some perfectly good planning documents sitting on the shelf at MWAA's Engineering Division waiting for UA to sign on the dotted line. And have been since 2008...


Wasn't that plan going to cost at least $1 B in 2008 dollars to complete? With costs rising as they are already, I don't see United signing anytime soon.

flyguy84 wrote:
The ORD expansion won’t drastically raise fees. The agreement is already signed, United knows what’s in it. They wouldn’t have agreed to something that would allow costs to skyrocket.


The projections are that the CPE will increase from $20 this year to $25 in 2025. That's the average CPE.

If ORD allocates the increases proportional to the amount spent on construction for each airline, United's CPE would be higher than the average.
 
ScottB
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Re: United's Plans for Dulles

Fri Apr 20, 2018 5:20 pm

mercure1 wrote:
Current management wants to grow UAL.
Only hub that has some gates + excess rwy capacity is IAD. Makes sense.


IAH has both gate space and runway capacity for growth. Additional gates are coming to DEN in the next few years and there remains ample spare runway capacity at that airport.

mmahpeel wrote:
This has been mentioned numerous times in previous discussions, but the cost issue always seems to get lost and the discussion turns into a DCA vs IAD fight. IAD can stand on it's own very well, but the high costs (and perhaps the mis-management of MWAA) is clearly impeding significant growth.


MWAA mismanagement (and extremely bad timing for overly expensive projects) definitely plays a part. No doubt they expected the slot restrictions at DCA and US Airways' long-running practice of slot-sitting with small aircraft to constrain capacity at DCA -- but instead, the DL-US slot deal and AA-US mergers divested DCA slots to LCCs and DCA now handles about 5 million more passengers annually compared to just five years ago. Most of those passengers probably would have ended up at IAD otherwise. Furthermore, they failed to see the continued growth of BWI, driven by WN and the ULCCs. But that should have been obvious given WN's decision to invest hundreds of millions of dollars in the Terminal A/B project there in the early 2000s.

So the bill came due for a bunch of expensive projects at IAD just as traffic started shifting to other airports in the region.
 
izbtmnhd
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Re: United's Plans for Dulles

Fri Apr 20, 2018 5:22 pm

toxtethogrady wrote:
william wrote:
This.............
"One big question facing Dulles is whether MWAA and United can reach an agreement on a new concourse C/D to replace the temporary facilities that the airline has used since the mid-1980s."


There are still some perfectly good planning documents sitting on the shelf at MWAA's Engineering Division waiting for UA to sign on the dotted line. And have been since 2008...


I think UA wants to stay profitable and not invest into a MWAA white whale.

It's amazing how some on here think UA needs to bend over backward to expand their IAD ops no matter what or B6 should expand again simply because IAD has gates which are not fully utilized. It makes no sense in the real world of things.

BTW let's hope things improve at IAD/DCA this year. DCA saw a 9% drop in traffic this January compared to last year. IAD's numbers were flat. Only one month but certainly not helping CPE if the downward trend were to continue.
 
DCAfan
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Re: United's Plans for Dulles

Fri Apr 20, 2018 5:38 pm

The 9% drop in January 2018 at DCA was due to the presidential Inauguration in 2017. DCA still lies in the sweet spot for the DMV.
 
Rdh3e
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Re: United's Plans for Dulles

Fri Apr 20, 2018 6:21 pm

ldvaviation wrote:
toxtethogrady wrote:
There are still some perfectly good planning documents sitting on the shelf at MWAA's Engineering Division waiting for UA to sign on the dotted line. And have been since 2008...


Wasn't that plan going to cost at least $1 B in 2008 dollars to complete? With costs rising as they are already, I don't see United signing anytime soon.

flyguy84 wrote:
The ORD expansion won’t drastically raise fees. The agreement is already signed, United knows what’s in it. They wouldn’t have agreed to something that would allow costs to skyrocket.


The projections are that the CPE will increase from $20 this year to $25 in 2025. That's the average CPE.

If ORD allocates the increases proportional to the amount spent on construction for each airline, United's CPE would be higher than the average.

Not if UA is growing faster than average, which is what they've indicated.

Also, $25 would still be WAY below IAD if they built a terminal. CPE was $21 at IAD in 2016. Once the money from the state of Virginia grant runs out the IAD CPE will be climbing again since the grant currently offsets about $3 of CPE.
 
izbtmnhd
Posts: 944
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Re: United's Plans for Dulles

Fri Apr 20, 2018 6:48 pm

DCAfan wrote:
The 9% drop in January 2018 at DCA was due to the presidential Inauguration in 2017. DCA still lies in the sweet spot for the DMV.


I think most locals would love to set afire the person who decided this region should be called the "DMV".

Otherwise you have a fair point. :D
 
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RyanairGuru
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Re: United's Plans for Dulles

Fri Apr 20, 2018 9:11 pm

toxtethogrady wrote:
mmahpeel wrote:
Cost, cost and cost. UA would love to move on to a new C/D and expand operations but the costs at IAD are very high, without the new C/D even being built.


Cost has been no deterrent to all the international carriers that have started service at IAD in the last few years. If United thinks IAD is expensive, wait till the O'Hare expansion is done.


The high CPE isn’t particularly important for higher yield international O&D, of which IAD generates plenty of traffic, as IAD isn’t competing against any other airport for those passengers.

It is vitally important though for a domestic hub, especially one with relatively low O&D. A passenger flying from BUF to FLL could connect BUF-IAD-FLL or BUF-ATL-FLL, or via EWR, LGA, JFK, PHL, CLT or DCA. United doesn’t have a particularly strong frequent flyer or corporate base in either the upstate or south Florida, so it’s unlikely they can command a premium fare over Delta on this route. Therefore UA will not be able to recover the additional cost of flying through IAD over ATL, where the CPE is a quarter what it is at IAD. Therefore United make less profit carrying the same passenger as Delta. On this basis is it worth even competing for these traffic flows? Smisek said no which is why IAD was drawn down so heavily after the merger, Kirby seems to think IAD is worth keeping but isn’t a huge priority.

A successful hub will either have high O&D (SFO, LAX, ORD, EWR) or very low operating costs (CLT). The best hubs have relatively high O&D and relatively low costs (ATL, DFW). IAD has neither, it is a high cost airport and while it does attract significant international and beyond perimeter O&D, within the perimeter it struggles.

On paper IAD is the perfect East Coast hub; it has oodles of runway capacity and spare gates, plenty of land to grow, significantly better weather than NYC/PHL, it is 2 hours flying time from any point east of the Mississippi, and virtually all north-south traffic passes right overhead. For these reasons you’d think IAD should be as big for United as CLT is for AA, which also has low O&D. That ignores that CPE at CLT is about $20 lower at CLT than IAD. On that fare from BUF to FLL that $20 would probably be the difference between making a profit on that passenger and making a loss.

In other high cost airports like SFO the hub carrier commands significant pricing premium as they have a de facto monopoly on the local frequent flyers and corporates. If those passengers want the most convenient schedules and most non-stop destinations they generally have a choice of one. It is therefore not uncommon to see a flight from a hub to a spoke 500 mi away sell for something like $400-500, whereas a passengers flying spoke-hub-spoke could pay $150. The local passengers are making the profit here, the connecting passengers are providing the volume to keep costs down and the network strong.

In IAD’s case for markets within the perimeter United cannot charge a premium, indeed they may need to charge less than comparable fares at DCA to make people consider IAD. Therefore they are not enjoying he O&D premium which will help offset the high CPE.

This is not to say that IAD is all doom and gloom. If CLT had a CPE even close to $20 it would have been dehubbed yesterday. IAD survives because it does serve a unique and privileged position for transcon and international traffic. Unfortunately though it will never make a great domestic hub.
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STT757
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Re: United's Plans for Dulles

Sat Apr 21, 2018 12:07 pm

Ryanairguru that was the best breakdown of the dynamics involved with IAD I've read. In the most ideal situation the hub carrier at IAD would have a large presence at DCA, similar to how AA and DL pair JFK with LGA. Concentrate on the market as a whole, not just one airport.
Eastern Air lines flt # 701, EWR-MCO Boeing 757
 
LoudounHound
Posts: 91
Joined: Tue Mar 25, 2014 8:43 pm

Re: United's Plans for Dulles

Sat Apr 21, 2018 1:04 pm

High costs don't necessarily last forever. MWAA's more prudent approach over the past few years has led to a significant drop in the CPE at IAD. Even without the two year boost from Virginia state coffers, the CPE had dropped below $20. Bonds issued to fund previous capital construction projects eventually mature, and debt service drops. MWAA is also taking proactive steps, e.g. looking to sell or lease the "western lands" portion of the property, which could potentially lower the CPE even more. Theoretically, the relentless area population increase, combined with the lower CPE, attracts more airline service, which in turn spreads fixed costs out even more in a virtuous cycle.

This is not to say that everything is rosy. The next recession might set things back another decade. But sooner or later, circumstances will align to make the C/D concourse replacement financially a no brainer.
 
LovePrunesAnet
Posts: 268
Joined: Sat Jan 14, 2017 2:04 am

Re: United's Plans for Dulles

Tue Apr 24, 2018 7:09 am

WaywardMemphian wrote:
The Metro will increase it's viability as an O&D airport for folks visiting DC. Even more desirable as a long layover place. It's not going to be any bigger of a hassle than the train from BWI once it's done plus there's the Smithsonian Air and Space on site. MEM recently stated it wants IAD service. There's a possible new city from IAD.


newsflash
"visitors" are going to the monuments, the zoo, Mt Vernon, White House, Congress, etc. The ride to/from Dulles on Metro to get to the main visitor areas will be an hour longer each way vs flying into National and a 10 minute ride on Metro.
I lived in the area and know that to visit the Smithsonian Air & Space Annex at Dulles is basically an all day trip from downtown, which is why most visitors skip it. It's a great museum but very inconvenient. I went once in 15 yrs living there and I even work in commercial aviation and am a big fan.

If you're visiting grandmas out in Reston or Herndon, then sure, you might wanna fly into Dulles, but not most domestic visitors when National is so much more convenient.

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